Larry Aden, left, stands out in front of his mobile home with his good friend and neighbor Larry Warley at Windmill Mobile Home Estates where they have both lived for about 13 years. Both opposed owner Peter Wang's requested rent increase.
The city's Mobile Home Rent Commission has raised the rents of 29 Windmill Mobile Home Estates residents by $71, from an average $365 to $436 a month.
The increase, which will be phased in over the next nine years, came after several months of negotiations between the commission and the park's owner, Peter Wang, who bought Windmill, located at 575 San Pedro Ave., for about $4.3 million in 2005. He first approached the commission for an increase in October.
About a third of the park's 90 spaces rent month-to-month, and will be affected by the increase. The other 61 residents are on a lease with a fixed rent.
In October, Wang approached the commission asking for a $190 increase, or about a 51 percent increase over the current $365 average.
The commission voted 3 to 1 on May 29 with commissioner Elena Ann Miles recusing, as she works at Windmill.
Commissioner John Liegl was the dissenting vote.
"The man made a poor decision when he bought Windmill," Liegl said. "The rents are very low, and he still made the investment. I'm not there to subsidize poor business decisions."
Commission Chair Swanee Edwards said the $71 monthly rent increase was "certainly less than what he wanted, but it is enough to give him a fair and equitable return."
Edwards said the commission worked with Wang on an increase over what the city's rent control ordinance allows because he showed evidence that the cost of doing business was more than he had anticipated.
According to the ordinance, a mobile home park owner may only increase rent once per year, and Wang increased rent in October so he has to wait another four months to start implementing the new increase.
Liegl wasn't the only person unhappy with the commission's final decision. Wang's attorney William Dahlin wrote in an e-mail to the Times, "The method used in the ordinance does not track or really provide for a property owner to earn a fair and reasonable return."
Dahlin said the ordinance doesn't account for all of the ongoing expenses Wang has.
"To use an analogy that is fitting in tday's setting, the owner is paying $4 per gallon for gas but will only receive reimbursement for that out of pocket expense at the rate of $2 per gallon," Dahlin wrote. "That is fundamentally wrong."
Dahlin said the option to appeal to the Santa Clara County Superior Court "is being closely reviewed."
Natalie Everett Natalie Everett covers education and city issues for The Times. Reach her at (408) 779-4106, ext. 201, or neverett@morganhilltimes.com.
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